PRAGMATIC CHINA AND THE MIDDLE EAST

Chinese president Xi Jinping

China is probably the only superpower capable of keeping a low political profile while, at the same time, infiltrating its business interests in strategic geopolitical areas. It has done so in Africa, it is doing so in the Middle East. The Chinese don’t care about Syria’s or Iraq’s territorial integrity, the Kurdish struggle for independence or the infighting between Sunni and Shia. Beijing is an external observer of the war in Yemen, the quarreling among Gulf States, the heated Palestinian debate. China consciously ignores these regional conflicts because of its business interests.

After all, where there is war, there is hope. Years of civil wars, systematic destruction of industries, infrastructure, roads and buildings offer wide opportunities for reconstruction. And while the other superpowers fight over political hegemony and for peaceful solutions to these conflicts, Beijing simply waits along for business opportunities. We all know China can offer competitive prices, accepts barter (work in exchange for raw materials) and usually delivers on time. Of course, the quality of the infrastructure built by the Chinese is often not very high, but this is just a secondary detail in countries where corruption is widespread.

The Chinese are not intrusive and hardly pose any problems. They bring their own people, set up a camp where they live confined, work 24-hour shifts and then leave. They do everything by themselves, without any economic spillover on the local economy. Even the materials they employ usually come from China. The money just goes in a circle: it leaves China and then returns home. The only additional tariff is the price of gaining the favors of the decision-makers. But the Middle East is full of oil, natural gas, and this puts the Chinese expectations way up high.

The Chinese are obviously interested in a stabilized Middle East. This is why, although often not more than a spectator, China attends the negotiations over Syria and Iran. Now that Bashar al Assad is posed to hold on to power, China has decided to send 300 doctors and military instructors to Syria also to defend its construction sites. In the recent past, China acted to favor the deal on the Iranian nuclear program. Today, instead, China is at ease signing billion dollar deals with general Khalifa Haftar in Libya, while the internationally recognized government is the one led by PM Fayez al Sarraj.

The economic penetration of the Middle East is a priority for Beijing. It was clearly stated by Chinese president Xi Jinping during his speech at the Arab League at the start of 2017. Strengthening the “One belt, one road” project, the new Silk Road spanning from Pakistan to the Middle East, was at the center of the discussions during the recent congress of the Chinese Communist Party. The intended development of the project with the countries touched by this revived commercial route should happen in three stages: focus on energy, then construction of infrastructure alongside trade and finance, to then culminate in technological and scientific collaboration.

The new silk road

The “One belt, one road” project has also a key strategic value, because it grants Chinese goods the possibility of crossing terrestrial and maritime routes via Iran, Pakistan and the Strait of Hormuz all the way to East Africa without having to go through the Suez Canal. After all, China imports around 60% of its oil and gas from the Middle East. And this is also why the Chinese are building a harbor in Duqm, in Oman, to manage its trade routes.

In 2013 the value of trade between China and the Middle East was worth around 230 billion dollars. Beijing wants to raise that figure to 600 billion by 2023, increase financial investments and create a free trade area. This is an ambitious target for a market that, unlike Africa or parts of Asia, is more sophisticated and requires a greater attention to quality.

In order to consolidate the economic links with the region, China is enlarging the base of the Shanghai Cooperation Organization to Middle Eastern countries. The group focuses on economy, security and culture and its membership was, until now, mainly from Asia. But it’s evolving to include Iran, which might soon shift from being an observer to a member as requested by president Xi, and Egypt, Syria and Israel, who have all applied to become observers.

We all know that China does not shy away from business, regardless who the political, religious or ethnic counterpart is.

The Chinese have signed a deal to build houses in Israel and will deploy around six thousand construction workers. Beijing doesn’t care that these buildings commissioned by the Israelis are in the Occupied Territories and are considered illegal by the UN. While the Chinese vote against illegal settlements at the Security Council, on the other they sign deals to build them.

  Chinese president Xi Jinping with Saudi crown prince Mohamed bin Salman

Saudi Arabia is the biggest commercial partner in the region for the Chinese. The cooperation is stretching to nuclear energy production and in helping the Saudis diminish their dependence from oil. China will help Egypt develop its telecommunications infrastructure and improve its national electric grid. The Chinese will finance the project by issuing bonds, as Beijing does not lack liquidity.

Right after the signing of the deal on its nuclear program, Iran has signed 5 billion worth of contracts with China in the following sectors: transport, mining, energy, steel and iron, chemical and pharmaceutical, automobiles and telecommunications. China exports equipment, provides technology and technical assistance. In other words, it is providing qualified economic penetration.

There are also a series of multinational projects: China is building a railroad stretching from Kuwait to Oman and crossing Saudi Arabia, the United Arab Emirates but also Qatar and Bahrain.

The only issue China seems to be worried about is the spread of radical Islam, given the presence of Uighur fighters in the ranks of the ISIS and following a number of terrorist attacks in Xinjiang. In 2016 the Chinese have signed an antiterrorism memorandum with Syria that will grant them access to the files of Asian terrorists detained in Syrian jails. At the same time, Egypt has started to persecute and arrest Uighur students who have taken refuge in the country. The Chinese are obvious masterminds of this repression.